Exports Are Last Viable Outlet for U.S. Crude Oil Oversupply: Platts' Bentek Energy

DENVER, April 9, 2015 /PRNewswire/ -- Current policies that limit exports of domestically produced U.S. crude oil could end the staggering growth of North America's oil sector amid the recent "shale boom," according to "Exports: Last Demand Standing," a new study just released by Platts' analytics and forecasting unit Bentek Energy*.  It concludes that unrestricted global exports appear to be the only immediate outlet for surging supply as the U.S. reaches domestic demand capacity. 

"Sustained export restrictions will produce damaging short- and long-term effects on domestic crude oil prices, the U.S. oil exploration and production (E&P) industry, and the U.S. economy as a whole," said Tony Starkey, Bentek Energy manager of energy analysis and lead author of the study. "The next several months will see refineries approach their capacity to absorb incremental U.S. crude oil production, and storage tanks push their limits to balance an oversupplied market."

Such a scenario would force drillers to scale back on their already-slowed drilling operations, the study notes. Read in full: http://www.bentekenergy.com/documents/Bentek_ExportsLastDemandStanding_April2015.pdf

In addition to the analysis of, and historical context around, the U.S. crude oil oversupply situation, the Bentek study explores the following statements:

• Inventory builds are implying the U.S. is oversupplied by 800 thousand barrels per day
• Traditional demand sources (displacing imports, higher refinery runs) are nearly fully maximized
• Oversupply at current production levels is a sobering narrative on future production growth
• Unrestricted U.S. crude oil exports represent the last significant demand source

For more information on oil, natural gas and natural gas liquids NGLs, analytics and forecasts, visit the websites of Bentek Energy and Platts.

* Bentek Energy was acquired by Platts in 2011.

About Platts: Founded in 1909, Platts is a leading global provider of energy, petrochemicals, metals and agriculture information and a premier source of benchmark prices for the physical and futures markets. Platts' news, pricing, analytics, commentary and conferences help customers make better-informed trading and business decisions and help the markets operate with greater transparency and efficiency. Customers in more than 150 countries benefit from Platts' coverage of the biofuels, carbon emissions, coal, electricity, oil, natural gas, metals, nuclear power, petrochemical, shipping and sugar markets. A division of McGraw Hill Financial (NYSE: MHFI), Platts is based in London with more than 1,000 employees in more than 15 offices worldwide. Additional information is available at www.platts.com.

About McGraw Hill Financial: McGraw Hill Financial  (NYSE: MHFI) is a leading financial intelligence company providing the global capital and commodity markets with independent benchmarks, credit ratings, portfolio and enterprise risk solutions, and analytics. The Company's iconic brands include: Standard & Poor's Ratings Services, S&P Capital IQ, S&P Dow Jones Indices, Platts, CRISIL and J.D. Power. The Company has approximately 17,000 employees in 30 countries. Additional information is available at www.mhfi.com.

SOURCE Platts

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